US chemical sector poised for dynamic expansion as investment increases

Supported by activity within the domestic chemicals sector, the ACC says the US economy is likely to see continued, though moderated growth in 2014, according to ACC's monthly Chemical Activity Barometer.

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Favorable oil-to-gas price ratios driven by the production of
natural gas from shale continue to drive a renewed US
competitiveness that is boosting exports and driving greater
domestic investment, economic growth and job creation within
the business of chemistry.

This is according to the Year End 2013 Chemical
Industry Situation and Outlook, published recently by
the American Chemistry Council (ACC) trade group.

Likewise, supported by activity within the domestic chemicals
sector, the ACC says the US economy is likely to see
continued, though moderated growth in 2014, according to
ACC's monthly Chemical Activity Barometer (CAB), released
Tuesday.

The Chemical Activity Barometer is an established leading
economic indicator, shown to lead US business cycles by an
average of eight months at cycle peaks, and four months at
cycle troughs.

The barometer ticked up to 93.9, a 0.1% increase over
November on a three-month moving average (3MMA) basis. This
marks the eighth consecutive monthly gain for the CAB, which
remains up 2.8% over a year ago.

"American chemistry is back in the game," said Dr. Kevin
Swift, ACC's chief economist. "After a decade of lost
competitiveness, American chemistry is reemerging as a growth
industry. We're seeing growing end-use markets; strengthening
employment; surging exports; and an influx of tremendous
capital investment. Put simply, the US is now the most
attractive place in the world to invest in chemical
manufacturing."

Swift and the ACC pointed to several key points to illustrate
the turnaround in the industry:

Over the next five years, US production is expected to
grow by almost 25%, pushing industry shipments to $1
trillion by 2018;

For the first time since 1999, the US chemical industry
is seeing job growth;

Shale gas and the surge in natural gas liquids supply
has helped move the US from being a high-cost producer of
key petrochemicals and resins to
among the lowest cost producers; globally. As a result,
exports are surging. The industry has gone from a chemicals
trade deficit to a surplus, this year expected to be about
$2.8 billion, and by 2018 reaching nearly $30 billion, from
almost $300 billion in total exports;

Capital investment is exploding. Beginning in 2010, as
chemical manufacturers began recovering from the Great
Recession there has been double digit growth in capital
spending -- including equipment upgrades and efficiency
investments. Over the next five years we are likely to see
more than $60 billion in domestic investment.